Identifying Operating Income Components
Following is the Deere & Company income statement for 2018.
a. Identify the components in its income statement that you would consider operating.
Using the drop-down box next to each account, indicate whether it is operating or nonoperating.
$ millions 2018 Operating or
Nonoperating
Net sales and revenue
Net sales $33,350.7 Answer
Finance and interest income 3,106.6 Answer
Other income 900.4 Answer
Total $37,357.7
Costs and expenses
Cost of sales 25,751.2 Answer
Research and development expenses 1,399.1 Answer
Selling, administrative and general expenses 1,657.6 Answer
Interest expense 3,455.5 Answer
Other operating expenses 1,203.6 Answer
Total 33,287.0
Income of consolidated group before income taxes 4,070.7
Provision for income taxes 1,726.9 Answer
Income of consolidated group 2,343.8
Equity in income of unconsolidated affiliates 26.8 Answer
Net income 2,370.6
Less: Net income attributable to noncontrolling interests 2.2
Net income attributable to Deere & Company $2,368.4
Notes:
• The income statement includes John Deere commercial and consumer tractor segment, a finance subsidiary that provides loan
and lease financing relating to the sales of those tractors, and a health care segment that provides managed
health care services for the company and certain outside customers.
• Equity in income of unconsolidated affiliates refers to income John Deere has earned on investments
made for strategic purposes.
